<PAGE>
SEMI-ANNUAL REPORT
---------------------
February 28, 1997
NEUBERGER&BERMAN
EQUITY TRUST-Registered Trademark-
Neuberger&Berman
NYCDC SOCIALLY RESPONSIVE TRUST
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
THE FUND
<S> <C>
CHAIRMAN'S LETTER 4
PORTFOLIO COMMENTARY 5
FINANCIAL STATEMENTS 7
FINANCIAL HIGHLIGHTS 13
PER SHARE DATA
THE PORTFOLIO
SCHEDULE OF
INVESTMENTS 15
TOP TEN EQUITY
HOLDINGS
FINANCIAL STATEMENTS 18
FINANCIAL HIGHLIGHTS 24
DIRECTORY 25
OFFICERS AND
TRUSTEES 26
</TABLE>
3
<PAGE>
CHAIRMAN'S LETTER April 11, 1997
Dear Fellow Shareholder:
During the six months ended February 28, 1997, we witnessed one of the most
explosive rallies in stock market history with the Dow Jones Industrial Average
and Standard & Poor's 500 Index gaining 23.82% and 22.60%, respectively. High
multiple blue chip stocks (particularly branded consumer goods companies),
continued to lead the market parade. Not left out of the rally were technology,
financial services, and health care stocks, which rebounded as well, helping our
funds achieve solid gains.
With the Dow and S&P "500" near record levels and equities valuations well
above historic norms, we are comforted by our conviction that our portfolios are
comprised of high quality companies trading at reasonable fundamental valuations
relative to the market and their long term growth prospects. We have a talented
and experienced group of analysts and portfolio managers who, in keeping with
our firm's heritage, focus primarily on value.
If the economy continues to provide low inflation, relatively low interest
rates and reasonable corporate earnings, stocks can continue to progress. We
believe well managed, financially sound companies in out-of-favor industries
will participate more fully in a market advance. We have faith investors will
ultimately see the folly in chasing a relative handful of blue-chip growth
stocks simply because they are going up in price. Sooner or later, money will
gravitate to equally high-quality companies selling at much more reasonable
fundamental valuations.
Whatever the market holds in store for us over the next six months and beyond,
we will continue to do what we have always done -- focus on quality and
value -- the two most important ingredients in the recipe for long term
investment success.
Sincerely,
/s/ Stanley Egener
Stanley Egener
Chairman of the Board
Neuberger&Berman Equity Trusts
4
<PAGE>
PORTFOLIO COMMENTARY
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
PORTFOLIO MANAGER JANET PRINDLE BELIEVES DOING GOOD IS GOOD BUSINESS AND
HAS THE POTENTIAL TO PRODUCE SOLID INVESTMENT RESULTS. SHE FOCUSES ON
COMPANIES THAT ARE AGENTS OF FAVORABLE CHANGE IN WORKPLACE POLICIES
(PARTICULARLY FOR WOMEN AND MINORITIES); THOSE THAT ARE GOOD CORPORATE
CITIZENS; AND THOSE THAT ARE RESPONSIVE TO ENVIRONMENTAL ISSUES. BUT,
SOCIAL RESPONSIBILITY ALONE DOES NOT QUALIFY A COMPANY AS A GOOD
INVESTMENT. TRUE TO NEUBERGER&BERMAN'S VALUE-ORIENTED INVESTMENT
PHILOSOPHY, SHE FIRST DETERMINES WHETHER PORTFOLIO CANDIDATES MEET
FUNDAMENTAL VALUES. HER AIM IS SIMPLE AND STRAIGHTFORWARD -- TO SERVE BOTH
SOCIETY AND HER SHAREHOLDERS.
For the six months ended February 28, 1997, the fund returned 15.96% compared
to the Standard & Poor's 500 Index's 22.60% gain.
During the first half of fiscal 1997, our investments in the banking,
insurance, technology, and specialty chemical industries worked quite well. We
believe our portfolio holdings in these groups continue to represent solid
fundamental values. Investments in the telecommunications and energy sectors did
not perform up to our expectations. Pending further clarification of competitive
issues in the telecommunications industry, we have pared our holdings. Despite
this year's decline in oil and natural gas prices, we believe selected energy
stocks have excellent earnings and appreciation potential.
In our opinion, banks and insurance companies are no longer as interest rate
sensitive as many investors perceive. We don't believe the bank stocks in our
portfolio need lower interest rates to improve earnings and cash flows. Banks
like CITICORP, National City, Mercantile, and CoreStates have the capacity to
post the kind of fundamental progress that can change investors' perceptions. In
addition, we think that, even with the good gains of the last six months,
insurance companies like Chubb, Equitable and ReliaStar remain good values
relative to their peer group and the broad market. Our social screens revealed
that these companies have positive aspects about them as well. ReliaStar has a
goal of donating 2% of pre-tax earnings to charity. CoreStates has
5
<PAGE>
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust (Cont'd)
excellent work-family programs, including on-site childcare. And Chubb has a
superb diversity record, with females representing 50% of officials and
managers.
Despite poor relative performance over the last few months, we remain fully
committed to energy stocks like Louisiana Land & Exploration, Noble Affiliates,
and Tidewater. The decline in oil prices did not surprise us. In fact, we
thought that oil's $24 per barrel price was unsustainable. We are not in the
price collapse camp either, believing the supply projections for non-OPEC
producers are dramatically over-estimated. If oil and natural gas prices
stabilize around current levels, earnings from the group could trend higher.
This appears to be a classic case of the stock market overreacting to a little
bad news.
We are currently seeking to take advantage of the sell-off of some
high-quality companies in the retail industry. Wal-Mart Stores which has been a
truly great company from the growth perspective, drifted down into the value
range as earnings momentum investors abandoned the stock due to lower annual
earnings growth projections. We were delighted to put it in our shopping basket
at what we see as a bargain price. We are also proud to own stock in a firm that
has been applauded for its employee relations and workplace policies and which
offers cash profit sharing at virtually all levels, including part-time
personnel.
We enjoy the challenge of earning good returns from investments in companies
that are responsive to society and their employees' needs. By so doing, we hope
to reward our collective consciences and our shareholders.
The composition, industries and holdings of the portfolio are subject to change.
NYCDC Socially Responsive Trust's portfolio is invested in a wide array of
stocks, and no single holding makes up more than a small fraction of the
portfolio's total assets.
Please remember that past performance is not indicative of future results.
6
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
February 28,
1997
(000'S OMITTED EXCEPT PER SHARE AMOUNT) (UNAUDITED)
--------------
<S> <C>
ASSETS
Investment in Portfolio, at value (Note A) $ 154,855
Receivable for Trust shares sold 156
Deferred organization costs (Note A) 19
Receivable from administrator -- net (Note
B) 8
--------------
155,038
--------------
LIABILITIES
Payable for Trust shares redeemed 59
Accrued expenses 53
--------------
112
--------------
NET ASSETS at value $ 154,926
--------------
NET ASSETS consist of:
Par value $ 10
Paid-in capital in excess of par value 115,553
Accumulated undistributed net investment
income 273
Accumulated net realized gains on investment 1,275
Net unrealized appreciation in value of
investment 37,815
--------------
NET ASSETS at value $ 154,926
--------------
SHARES OUTSTANDING
($.001 par value; unlimited shares
authorized) 10,099
--------------
NET ASSET VALUE, offering and redemption price per
share $15.34
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
STATEMENT OF OPERATIONS
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
For the
Six Months
Ended
February 28,
1997
(000'S OMITTED) (UNAUDITED)
------------
<S> <C>
INVESTMENT INCOME
Investment income from Portfolio (Note A) $ 1,250
------------
Expenses:
Administration fee (Note B) 35
Shareholder reports 28
Legal fees 11
Shareholder servicing agent fees 9
Custodian fees 5
Amortization of deferred organization and
initial offering expenses (Note A) 5
Registration and filing fees 5
Auditing fees 3
Trustees' fees and expenses 3
Miscellaneous 1
Expenses from Portfolio (Notes A & B) 445
------------
Total expenses 550
Deduct -- expenses reimbursed by
administrator (Note B) (128)
------------
Total net expenses 422
------------
Net investment income 828
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS FROM
PORTFOLIO (NOTE A)
Net realized gain on investment securities 3,086
Change in net unrealized appreciation of
investment securities 16,551
------------
Net gain on investments from Portfolio
(Note A) 19,637
------------
Net increase in net assets resulting from
operations $ 20,465
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
For the
Six Months For the
Ended Year
February 28, Ended
1997 August 31,
(000'S OMITTED) (UNAUDITED) 1996
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 828 $ 1,173
Net realized gain on investments
from Portfolio (Note A) 3,086 10,311
Change in net unrealized
appreciation of investments from
Portfolio (Note A) 16,551 8,073
-----------------------------
Net increase in net assets resulting
from operations 20,465 19,557
-----------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,442) (895)
Net realized gain on investments (10,729) (2,312)
-----------------------------
Total distributions to shareholders (12,171) (3,207)
-----------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 20,202 32,430
Proceeds from reinvestment of
dividends and distributions 12,171 3,206
Payments for shares redeemed (11,377) (14,893)
-----------------------------
Net increase from Trust share
transactions 20,996 20,743
-----------------------------
NET INCREASE IN NET ASSETS 29,290 37,093
NET ASSETS:
Beginning of period 125,636 88,543
-----------------------------
End of period $ 154,926 $ 125,636
-----------------------------
Accumulated undistributed net
investment income at
end of period $ 273 $ 887
-----------------------------
NUMBER OF TRUST SHARES:
Sold 1,316 2,332
Issued on reinvestment of dividends
and distributions 812 238
Redeemed (741) (1,077)
-----------------------------
Net increase in shares outstanding 1,387 1,493
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman February 28, 1997 (Unaudited)
- ----------------------------------------------------------------------
Equity Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman NYCDC Socially Responsive Trust (the "Fund") is a
separate operating series of Neuberger&Berman Equity Trust (the "Trust"), a
Delaware business trust organized pursuant to a Trust Instrument dated May 6,
1993. The Trust is registered as a diversified, open-end management
investment company under the Investment Company Act of 1940, as amended, and
its shares are registered under the Securities Act of 1933, as amended. The
trustees of the Trust may establish additional series or classes of shares
without the approval of shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
The Fund seeks to achieve its investment objective by investing all of its
net investable assets in the Neuberger&Berman Socially Responsive Portfolio
of Equity Managers Trust (the "Portfolio") having the same investment
objective and policies as the Fund. The value of the Fund's investment in the
Portfolio reflects the Fund's proportionate interest in the net assets of the
Portfolio (76.39% at February 28, 1997). The Fund was created as an
investment vehicle for participants in the Deferred Compensation Plan of the
City of New York and Related Agencies and Instrumentalities. The performance
of the Fund is directly affected by the performance of the Portfolio. The
financial statements of the Portfolio, including the Schedule of Investments,
are included elsewhere in this report and should be read in conjunction with
the Fund's financial statements.
2) PORTFOLIO VALUATION: The Fund records its investment in the Portfolio at
value. Investment securities held by the Portfolio are valued by Equity
Managers Trust as indicated in the notes following the Portfolio's Schedule
of Investments.
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of the Fund to
continue to qualify as a regulated investment company by complying with the
provisions available to certain investment companies, as defined in
applicable sections of the Internal Revenue Code, and to make distributions
of investment company taxable income and net capital gains (after reduction
for any amounts available for Federal income tax purposes as capital loss
carryforwards) sufficient to relieve it from all, or substantially all,
Federal income taxes. Accordingly, the Fund paid no Federal income taxes and
no provision for Federal income taxes was required.
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: The Fund earns income, net of
Portfolio expenses, daily on its investment in the Portfolio. Dividends and
10
<PAGE>
distributions from net realized capital gains, if any, are normally
distributed in December. Income dividends and capital gain distributions to
shareholders are recorded on the ex-dividend date. To the extent the Fund's
net realized capital gains, if any, can be offset by capital loss
carryforwards, it is the policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by the Fund in connection with its
organization are being amortized on a straight-line basis over a five-year
period. At February 28, 1997, the unamortized balance of such expenses
amounted to $19,461.
6) EXPENSE ALLOCATION: The Fund bears all costs of its operations. Expenses
incurred by the Trust with respect to any two or more funds are allocated in
proportion to the net assets of such funds, except where a more appropriate
allocation of expenses to each fund can otherwise be made fairly. Expenses
directly attributable to a fund are charged to that fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of the Portfolio are allocated pro rata among its respective funds
and any other investors in the Portfolio.
NOTE B -- ADMINISTRATION FEES, DISTRIBUTION ARRANGEMENTS, AND OTHER TRANSACTIONS
WITH AFFILIATES:
The Fund retains Neuberger&Berman Management Incorporated ("Management") as
its administrator under an Administration Agreement ("Agreement") dated as of
March 11, 1994. Pursuant to this Agreement the Fund pays Management an
administration fee at the annual rate of 0.05% of the Fund's average daily net
assets and indirectly pays for investment management services through its
investment in the Portfolio (see Note B of Notes to Financial Statements of the
Portfolio).
Management has voluntarily undertaken to reimburse the Fund for its operating
expenses and its pro rata share of the Portfolio's operating expenses (including
the fees payable to Management but excluding interest, taxes, brokerage
commissions, and extraordinary expenses) which exceed, in the aggregate, 0.60%
per annum of the Fund's average daily net assets. This undertaking is subject to
termination by Management upon at least 60 days' prior written notice to the
Fund. For the six months ended February 28, 1997, such excess expenses amounted
to $128,258.
All of the capital stock of Management is owned by individuals who are also
principals of Neuberger&Berman, LLC ("Neuberger"), a member firm of The New
11
<PAGE>
York Stock Exchange and sub-adviser to the Portfolio. Several individuals who
are officers and/or trustees of the Trust are also principals of Neuberger
and/or officers and/or directors of Management.
The Fund also has a distribution agreement with Management. Management
receives no compensation therefor and no commissions for sales or redemptions of
shares of beneficial interest of the Fund.
The Portfolio has an expense offset arrangement in connection with its
custodian contract. The impact of this arrangement, reflected in the Statement
of Operations under the caption Expenses from Portfolio, was a reduction of
$223, which is less than .01% of the Fund's average daily net assets.
NOTE C -- INVESTMENT TRANSACTIONS:
During the six months ended February 28, 1997, additions and reductions in
the Fund's investment in the Portfolio amounted to $13,182,058 and $4,397,750,
respectively.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent accountants. Annual reports
contain audited financial statements.
12
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
NYCDC Socially Responsive Trust
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of the Portfolio's income and
expenses. It should be read in conjunction with the Portfolio's Financial
Statements and notes thereto.
<TABLE>
<CAPTION>
For the
For the Period from
Six Months Ended For the Year March 14,
February 28, Ended 1994(1)
1997 August 31, to August 31,
(UNAUDITED) 1996 1995 1994
-----------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $14.42 $ 12.27 $ 10.43 $10.20
-----------------------------------------------------
Income From Investment Operations
Net Investment Income .09 .14 .13 .06
Net Gains or Losses on Securities
(both realized and unrealized) 2.18 2.44 1.82 .17
-----------------------------------------------------
Total From Investment Operations 2.27 2.58 1.95 .23
-----------------------------------------------------
Less Distributions
Dividends (from net investment
income) (.16) (.12) (.11) --
Distributions (from capital gains) (1.19) (.31) -- --
-----------------------------------------------------
Total Distributions (1.35) (.43) (.11) --
-----------------------------------------------------
Net Asset Value, End of Period $15.34 $ 14.42 $ 12.27 $10.43
-----------------------------------------------------
Total Return(2) +15.96%(3) +21.27% +18.95% +2.26%(3)
-----------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $154.9 $ 125.6 $ 88.5 $ 68.6
-----------------------------------------------------
Ratio of Expenses to Average Net
Assets(4) .60%(5) .60% .60% .60%(5)
-----------------------------------------------------
Ratio of Net Investment Income to
Average Net Assets(4) 1.18%(5) 1.06% 1.26% 1.42%(5)
-----------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
13
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman February 28, 1997 (Unaudited)
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
1) The date investment operations commenced.
2) Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each fiscal
period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed certain expenses.
3) Not annualized.
4) After reimbursement of expenses by Management as described in Note B of Notes
to Financial Statements. Had Management not undertaken such action the
annualized ratios to average daily net assets would have been:
<TABLE>
<CAPTION>
For the
For the For the Period from
Six Months Ended Year Ended March 14, 1994
February 28, August 31, to August 31,
1997 1996 1995 1994
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Expenses .78% .80% .85% .84%
--------------------------------------------------------
Net Investment Income 1.00% .86% 1.01% 1.18%
--------------------------------------------------------
</TABLE>
5) Annualized.
14
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1997 (Unaudited)
- --------------------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS
---------------------------------------------------
HOLDING PERCENTAGE
<C> <S> <C>
1. Intel Corp. 2.7%
2. ReliaStar Financial 2.4%
3. Warner-Lambert 2.3%
4. National City 2.2%
5. Travelers Group 2.1%
6. A.G. Edwards 2.1%
7. Hewlett-Packard 2.1%
8. CoreStates Financial 2.1%
9. Morton International 2.0%
10. Equitable Cos. 2.0%
</TABLE>
<TABLE>
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
COMMON STOCKS (96.0%)
AGRICULTURE (1.1%)
83,500 Mycogen Corp. $ 2,181
-------------
AUTOMOTIVE (2.0%)
103,000 Borg-Warner Automotive 4,068
-------------
BANKING (10.1%)
32,000 CITICORP 3,736
80,007 CoreStates Financial 4,211
230,000 Dime Bancorp 4,025
70,000 Mercantile Bancorporation 4,051
90,000 National City 4,545
-------------
20,568
-------------
BUSINESS SERVICES (3.4%)
120,000 Dun & Bradstreet 2,940
130,000 John H. Harland 3,932
-------------
6,872
-------------
CHEMICALS (8.1%)
45,000 Air Products & Chemicals 3,336
110,000 Dexter Corp. 3,245
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
60,000 Minerals Technologies $ 2,272
100,000 Morton International 4,125
50,000 Perkin-Elmer 3,550
-------------
16,528
-------------
COMMUNICATIONS (1.0%)
141,700 Matav-Cable Systems Media ADR 2,037
-------------
CONSUMER GOODS & SERVICES (5.0%)
30,000 Kimberly-Clark 3,180
29,400 Procter & Gamble 3,532
100,000 Viacom Inc. Class B 3,525
-------------
10,237
-------------
DIVERSIFIED (1.7%)
60,000 Tyco International 3,540
-------------
ENERGY (1.5%)
80,000 Noble Affiliates 3,120
-------------
FINANCIAL SERVICES (7.9%)
120,000 A.G. Edwards 4,260
20,000 ADVANTA Corp. Class A 828
64,000 ADVANTA Corp. Class B 2,568
100,000 Fannie Mae 4,000
80,000 Travelers Group 4,290
-------------
15,946
-------------
FOOD & BEVERAGE (3.7%)
85,200 McDonald's Corp. 3,685
160,000 Whitman Corp. 3,760
-------------
7,445
-------------
FURNISHINGS (1.8%)
100,000 Leggett & Platt 3,587
-------------
HEALTH CARE (7.4%)
70,000 Johnson & Johnson 4,034
50,000 McKesson Corp. 3,312
</TABLE>
15
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1997 (Unaudited)
- --------------------------------------------------------------------------------
Socially Responsive Portfolio (Cont'd)
<TABLE>
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
40,000 SmithKline Beecham ADR $ 2,970
55,000 Warner-Lambert 4,620
-------------
14,936
-------------
INDUSTRIAL & COMMERCIAL PRODUCTS (1.7%)
40,000 Raychem Corp. 3,405
-------------
INSURANCE (7.8%)
102,600 Allmerica Property & Casualty 3,219
60,000 Chubb Corp. 3,517
130,000 Equitable Cos. 4,079
80,000 ReliaStar Financial 4,960
-------------
15,775
-------------
OIL & GAS (3.9%)
100,000 ENSERCH Corp. 2,100
200,000 Enserch Exploration 1,925
80,000 Louisiana Land & Exploration 3,820
-------------
7,845
-------------
OIL SERVICES (1.0%)
50,000 Tidewater Inc. 2,150
-------------
PAPER & FOREST PRODUCTS (1.4%)
50,000 Mead Corp. 2,912
-------------
RAILROADS (1.8%)
104,600 Illinois Central 3,596
-------------
RECYCLING (1.2%)
150,000 IMCO Recycling 2,363
-------------
RETAIL STORES (1.6%)
90,000 Nordstrom, Inc. 3,308
-------------
RETAILING (3.8%)
145,000 Costco Cos. 3,716
150,000 Wal-Mart Stores 3,956
-------------
7,672
-------------
TECHNOLOGY (8.2%)
85,000 AMP, Inc. 3,305
120,000 Cabletron Systems 3,600
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
76,000 Hewlett-Packard $ 4,256
38,000 Intel Corp. 5,391
-------------
16,552
-------------
TELECOMMUNICATIONS (7.3%)
70,000 AT&T Corp. 2,791
167,500 Jones Intercable Inc. Class A 1,612
250,000 Metromedia International Group 2,485
52,000 Southern New England
Telecommunications 1,885
50,000 Telephone & Data Systems 2,000
150,000 WorldCom Inc. 3,994
-------------
14,767
-------------
UTILITIES (1.6%)
115,000 Brooklyn Union Gas 3,277
-------------
TOTAL COMMON STOCKS (COST
$149,589) 194,687
-------------
<CAPTION>
Principal
Amount
- ----------
<C> <S> <C>
U.S. TREASURY SECURITIES (5.4%)
$10,985,000 U.S. Treasury Bills, 4.87% -
5.02%, due 3/6/97 - 4/24/97
(COST $10,933) 10,933(2)
-------------
TOTAL INVESTMENTS (101.4%)
(COST $160,522) 205,620(3)
Liabilities, less cash,
receivables and other assets
[(1.4%)] (2,904)
-------------
TOTAL NET ASSETS (100.0%) $ 202,716
-------------
</TABLE>
SEE NOTES TO SCHEDULE OF INVESTMENTS
16
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1997 (Unaudited)
- ----------------------------------------------------------------------
Socially Responsive Portfolio
1) Investment securities of the Portfolio are valued at the latest sales price;
securities for which no sales were reported, unless otherwise noted, are
valued at the mean between the closing bid and asked prices. The Portfolio
values all other securities by a method that the trustees of Equity Managers
Trust believe accurately reflects fair value. Short-term debt securities with
less than 60 days until maturity may be valued at cost which, when combined
with interest earned, approximates market value.
2) At cost, which approximates market value.
3) The cost of investments for Federal income tax purposes was $160,550,000. At
February 28, 1997, gross unrealized appreciation of investments was
$48,652,000 and gross unrealized depreciation of investments was $3,582,000,
resulting in net unrealized appreciation of $45,070,000, based on cost for
Federal income tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
17
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
February 28,
1997
(000'S OMITTED) (UNAUDITED)
--------------
<S> <C>
ASSETS
Investments in securities, at market value*
(Note A) -- see Schedule of Investments $ 205,620
Cash 1
Dividends receivable 224
Deferred organization costs (Note A) 14
Prepaid expenses 2
--------------
205,861
--------------
LIABILITIES
Payable for collateral on securities loaned
(Note A) 2,200
Payable for securities purchased 827
Payable to investment manager (Note B) 85
Accrued expenses 33
--------------
3,145
--------------
NET ASSETS Applicable to Investors' Beneficial
Interests $ 202,716
--------------
NET ASSETS consist of:
Paid-in capital $ 157,618
Net unrealized appreciation in value of
investment securities 45,098
--------------
NET ASSETS $ 202,716
--------------
*Cost of investments $ 160,522
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
18
<PAGE>
STATEMENT OF OPERATIONS
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months
Ended
February 28,
1997
(000'S OMITTED) (UNAUDITED)
------------
<S> <C>
INVESTMENT INCOME
Income:
Dividend income $ 1,358
Interest income 252
Foreign taxes withheld (Note A) (2)
------------
Total income 1,608
------------
Expenses:
Investment management fee (Note B) 497
Custodian fees (Note B) 42
Auditing fees 10
Legal fees 10
Accounting fees 5
Trustees' fees and expenses 4
Amortization of deferred organization and
initial offering expenses (Note A) 3
Insurance expense 2
------------
Total expenses 573
------------
Net investment income 1,035
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investment securities
sold 3,304
Change in net unrealized appreciation of
investment securities 21,855
------------
Net gain on investments 25,159
------------
Net increase in net assets resulting from
operations $ 26,194
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
19
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months For the
Ended Year
February 28, Ended
1997 August 31,
(000'S OMITTED) (UNAUDITED) 1996
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 1,035 $ 1,307
Net realized gain on investments 3,304 11,385
Change in net unrealized
appreciation of investments 21,855 9,035
-----------------------------
Net increase in net assets resulting
from operations 26,194 21,727
-----------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 23,082 45,974
Reductions (5,045) (5,963)
-----------------------------
Net increase in net assets resulting
from transactions in
investors' beneficial interests 18,037 40,011
-----------------------------
NET INCREASE IN NET ASSETS 44,231 61,738
NET ASSETS:
Beginning of period 158,485 96,747
-----------------------------
End of period $ 202,716 $ 158,485
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
20
<PAGE>
NOTES TO FINANCIAL STATEMENTS
February 28, 1997 (Unaudited)
- ----------------------------------------------------------------------
Equity Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Socially Responsive Portfolio (the "Portfolio") is
a separate operating series of Equity Managers Trust ("Managers Trust"), a
New York common law trust organized as of December 1, 1992. Managers Trust is
registered as a diversified, open-end management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"). Other regulated
investment companies sponsored by Neuberger&Berman Management Incorporated
("Management"), whose financial statements are not presented herein, also
invest in the Portfolio and other portfolios of Managers Trust.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
2) PORTFOLIO VALUATION: Investment securities are valued as indicated in the
notes following the Portfolio's Schedule of Investments.
3) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Portfolio
becomes aware of the dividends. Interest income, accretion of original issue
discount, where applicable, and accretion of discount on short-term
investments is recorded on the accrual basis. Realized gains and losses from
securities transactions are recorded on the basis of identified cost.
4) FEDERAL INCOME TAXES: Managers Trust intends to comply with the requirements
of the Internal Revenue Code of 1986, as amended. Each portfolio of Managers
Trust also intends to conduct its operations so that each of its investors
will be able to qualify as a regulated investment company. Each portfolio
will be treated as a partnership for Federal income tax purposes and is
therefore not subject to Federal income tax.
5) FOREIGN TAXES: Foreign taxes withheld represents amounts withheld by foreign
tax authorities, net of refunds recoverable.
6) ORGANIZATION EXPENSES: Expenses incurred by the Portfolio in connection with
its organization are being amortized by the Portfolio on a straight-line
basis over a five-year period. At February 28, 1997, the unamortized balance
of such expenses amounted to $13,745.
7) EXPENSE ALLOCATION: The Portfolio bears all costs of its operations. Expenses
incurred by Managers Trust with respect to any two or more portfolios are
21
<PAGE>
allocated in proportion to the net assets of such portfolios, except where a
more appropriate allocation of expenses to each portfolio can otherwise be
made fairly. Expenses directly attributable to a portfolio are charged to
that portfolio.
8) SECURITY LENDING: Portfolio securities loans involve certain risks in the
event a borrower should fail financially, including delays or inability to
recover the lent securities or foreclosure against the collateral. The
investment manager, under the general supervision of Managers Trust's Board
of Trustees, monitors the creditworthiness of the parties to whom the
Portfolio makes security loans. The Portfolio will not lend securities on
which covered call options have been written, or lend securities on terms
which would prevent each of their investors from qualifying as a regulated
investment company. Portfolio securities loans to Neuberger&Berman, LLC
("Neuberger"), the Portfolio's principal broker and sub-adviser, are made in
accordance with an exemptive order issued by the Securities and Exchange
Commission under the 1940 Act. The Portfolio receives cash as collateral
against the lent securities, which must be maintained at not less than 100%
of the market value of the lent securities during the period of the loan. The
Portfolio receives income earned on the lent securities and a portion on the
income earned on the cash collateral. During the six months ended February
28, 1997, the Portfolio lent securities to Neuberger. At February 28, 1997,
cash collateral received by the Portfolio was equal to or in excess of 100%
of the market value of the loaned securities.
9) REPURCHASE AGREEMENTS: The Portfolio may enter into repurchase agreements
with institutions that the Portfolio's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Portfolio
requires that the securities purchased in a repurchase transaction be
transferred to the custodian in a manner sufficient to enable the Portfolio
to obtain those securities in the event of a default under the repurchase
agreement. The Portfolio monitors, on a daily basis, the value of the
securities transferred to ensure that their value, including accrued
interest, is greater than amounts owed to the Portfolio under each such
repurchase agreement.
NOTE B -- MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES:
The Portfolio retains Management as its investment manager under a Management
Agreement dated as of March 11, 1994. For such investment management services,
the Portfolio pays Management a fee at the annual rate of 0.55% of the first
$250 million of the Portfolio's average daily net assets, 0.525% of the next
$250 million, 0.50% of the next $250 million, 0.475% of the next $250 million,
0.45% of the next $500 million, and 0.425% of average daily net assets in excess
of $1.5 billion.
All of the capital stock of Management is owned by individuals who are also
principals of Neuberger, a member firm of The New York Stock Exchange and sub-
adviser to the Portfolio. Neuberger is retained by Management to furnish it with
22
<PAGE>
investment recommendations and research information without added cost to the
Portfolio. Several individuals who are officers and/or trustees of Managers
Trust are also principals of Neuberger and/or officers and/or directors of
Management.
The Portfolio has an expense offset arrangement in connection with its
custodian contract. The impact of this arrangement, reflected in the Statement
of Operations under the caption Custodian fees was a reduction of $287, which is
less than .01% of the Portfolio's average daily net assets.
NOTE C -- SECURITIES TRANSACTIONS:
During the six months ended February 28, 1997, there were purchase and sale
transactions (excluding short-term securities) of $60,285,463 and $40,655,492,
respectively.
During the six months ended February 28, 1997, brokerage commissions on
securities transactions amounted to $134,333, of which Neuberger received
$101,505, and other brokers received $32,828.
In addition, Neuberger's share of the total interest income earned for the
six months ended February 28, 1997 from the collateralization of securities
loaned to or through Neuberger was $11,117.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of the Portfolio without audit by independent accountants. Annual
reports contain audited financial statements.
23
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months
Ended For the
February Period from
28, For the Year Ended March 14, 1994(1)
1997 August 31, to August 31,
(UNAUDITED) 1996 1995 1994
---------------------------------------------------------
<S> <C> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses .63%(2) .65% .68% .69%(2)
---------------------------------------------------------
Net Investment Income 1.15%(2) 1.02% 1.18% 1.33%(2)
---------------------------------------------------------
Portfolio Turnover Rate 23% 53% 58% 14%
---------------------------------------------------------
Average Commission Rate Paid $0.0575 $0.0587 -- --
---------------------------------------------------------
Net Assets, End of Period (in millions) $202.7 $158.5 $96.7 $70.7
---------------------------------------------------------
</TABLE>
1) The date investment operations commenced.
2) Annualized.
24
<PAGE>
DIRECTORY
INVESTMENT MANAGER, ADMINISTRATOR
AND DISTRIBUTOR
Neuberger&Berman Management Incorporated
605 Third Avenue 2nd Floor
New York, NY 10158-0180
800-877-9700
Institutional Services 800-366-6264
SUB-ADVISER
Neuberger&Berman, LLC
605 Third Avenue
New York, NY 10158-3698
CUSTODIAN AND SHAREHOLDER
SERVICING AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
ADDRESS CORRESPONDENCE TO:
Deferred Compensation Plan of the
City of New York and Related Agencies
and Instrumentalities
40 Rector Street 3rd Floor
New York, NY 10006
212-306-7760
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, NW
2nd Floor
Washington, DC 20036-1800
Neuberger&Berman Management Inc. & Neuberger&Berman NYCDC Socially Responsive
Trust are service marks of Neuberger&Berman Management Inc.
- -C- 1997 Neuberger&Berman Management Inc.
25
<PAGE>
OFFICERS AND TRUSTEES
Stanley Egener
CHAIRMAN OF THE BOARD AND TRUSTEE
Lawrence Zicklin
PRESIDENT AND TRUSTEE
Faith Colish
TRUSTEE
Donald M. Cox
TRUSTEE
Alan R. Gruber
TRUSTEE
Howard A. Mileaf
TRUSTEE
Edward I. O'Brien
TRUSTEE
John T. Patterson, Jr.
TRUSTEE
John P. Rosenthal
TRUSTEE
Cornelius T. Ryan
TRUSTEE
Gustave H. Shubert
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Claudia A. Brandon
SECRETARY
Barbara DiGiorgio
ASSISTANT TREASURER
Celeste Wischerth
ASSISTANT TREASURER
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
26
<PAGE>
NEUBERGER&BERMAN MANAGEMENT INC.-Registered Trademark-
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0180
SHAREHOLDER SERVICES
800.877.9700
INSTITUTIONAL SERVICES
800.366.6264
Statistics and projections in this report are derived from
sources deemed to be reliable but cannot be regarded as a
representation of future results of the Fund. This report is
prepared for the general information of shareholders and is
not an offer of shares of the Fund. Shares are sold only
through the currently effective prospectus, which must precede
or accompany this report.
[RECYCLE SYMBOL] PRINTED ON RECYCLED PAPER NBESAR050297
